Thursday, December 14, 2006

Pirates of The Studios

So Pirates of the Caribbean 2 has just sold over 10 million DVD's. Wow. One of the fastest sellers ever.

Some Disney exec's Christmas trees will be loaded with designer baubles this year. Assuming the wholesale price is around $10 [just a guess] that's a cool $100,000000 in revenue and around $66 million gross profit.

And this is where HW really makes it's money. Take the world wide figures for year 2004 for the six major studios. [IN $ BILLIONS]

Theatrical Release - 7.4 / [2.2]

DVD/VIDEO - 20.9 / 13.95

Wowser. They actually made a loss of 2.2 Billion on theatrical releases. Not surprising when you factor in the cost of making a movie, the P&A costs and the frantic book cooking studios indulge in to make sure no one on the soft back end [net profits] ever sees a dime.

But look at that DVD baby go. Almost 14 Billion dollars profit. Nearly DOUBLE the entire theatrical revenue.

And guess what? Even that isn't the most profitable sector for the studios. The most profitable sector for studios is............TV.

Here's the figures for 2004.


TV Sell Through - 17.7 Billion / 15.9 Billion

A gross profit of 90%. Un-fucking- heard off apart from prostitution.

But here's the kicker. If the writers Elliot and Rossio are on the WGA standard 1.5% of 20% of DVD sales, from that $100, 000000 , they'll be lucky to see a hundred grand apiece. [They will see more because their super smart agents will have negotiated built in bonus fees]

But still. Studio makes 66 Million. Writers make 200K. Mmmmmmmmm? Sound reasonable?

I've heard all the arguments that studios take the risk and that is why as a comparison to total film budget the writer's fee is almost miniscule. And to some extent that's a fair point. But here we're talking post risk. And the place where the writer could really be rewarded.

1.5% of 20% is piss ant money. Just my take on it.


Robin Kelly said...

It looks like the WGA may actually do something about that DVD deal when the contract runs out next autumn, as they've bottled it previously. Studios are already starting to stockpile scripts in case of a strike.

English Dave said...

I was looking at an old BBC contract which gives DVD rights of 3% of gross revenue over 50,000 units. [Between 2 and 3% for under 50,000 units]

On that basis Elliot and Rossi would have trousered around 3 million bucks instead of 200k.

BIG difference.

Alex Epstein said...

On the other hand I'm pretty sure Terry and Ted made a sack more coin up front. And they didn't exactly come up with the idea for doing a movie about Pirates of the Caribbean.